U.S. refining capacity rose by 0.2% in 2014

Refining capacity in the United States – measured as operable atmospheric crude distillation unit (CDU) capacity – increased by 0.2% in 2014, reaching a total capacity of 18 MMBOPD, according to the Energy Information Administration’s (EIA) Refinery Capacity Report.

Refinery Capacity

The refinery capacity reported for the beginning of 2015 includes expansions that were operable on January 1, but not necessarily operating, says the EIA. The units that were not operating as of the first of the year were listed as idle capacity in the EIA’s analysis.

Dakota Prairie Refining recently completed construction of one of the few new refineries built in the U.S. in the past 30 years. The refinery, which is located in western North Dakota, has CDU capacity of 19 MBOPD and will refine locally produced crude oil to make diesel fuel. Earlier this year, Kinder Morgan (ticker: KMI) added a 42 MBOPD condensate splitter to its Galena Park, Texas crude oil terminal that is a also included in the capacity estimate for the start of 2015. A second unit with similar capacity is expected to start operating this summer, but it is not included in the January 1, 2015 capacity estimate.

The increase in refining capacity came from the need to accommodate increasing domestic crude oil production, says the EIA. Domestic crude production rose to an average of 8.7 MMBOPD in 2014, up 3.2 MMBOPD from 2010. Gross inputs to refineries averaged a record 16.1 MMBOPD in 2014 compared with 15.1 MMBOPD in 2010. Nearly 75% of the 1.0 MMBOPD increase in refinery gross inputs is the result of a 4% increase in refinery utilization compared with 2010 (from 86% to 90%). The rest of the increase is attributable to capacity expansions, says the administration. Over the same period, crude imports decreased by 1.9 MMBOPD, while crude exports increased by 0.3 MMBOPD.

Refining capacity

For 2015, capacity is expected to expand by an additional 119,000 barrels per stream day. Delek U.S. (ticker: DK) plans to increase CDU capacity by 10 MBOPD at its Tyler, Texas refinery, and Marathon (ticker: MRO) reported that it plans to add 35 MBOPD of condensate splitter capacity at its Catlettsburg, Kentucky refinery by the end of the year.


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